ADB.BK WACC - Weighted Average Cost of Capital

The WACC of Applied DB PCL (ADB.BK) is 9.7%.

The Cost of Equity of Applied DB PCL (ADB.BK) is 9.75%.

The Cost of Debt of Applied DB PCL (ADB.BK) is 11.80%.

	Range	Selected
Cost of equity	8.20% - 11.30%	9.75%
Tax rate	17.80% - 19.50%	18.65%
Cost of debt	4.00% - 19.60%	11.80%
WACC	6.4% - 12.9%	9.7%

WACC

ADB.BK WACC calculation

Category	Low	High

Long-term bond rate	2.6%	3.1%
Equity market risk premium	7.4%	8.4%
Adjusted beta	0.75	0.92

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.20%	11.30%

Tax rate	17.80%	19.50%
Debt/Equity ratio	0.56	0.56
Cost of debt	4.00%	19.60%

After-tax WACC	6.4%	12.9%


Selected WACC	9.7%

ADB.BK's CAPM model and how its cost of Equity is calculated

The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.

This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.

Here’s how we figure out the cost of equity for ADB.BK:

cost_of_equity (9.75%) = risk_free_rate (2.85%) + equity_risk_premium (7.90%) * adjusted_beta (0.75) + risk_adjustments (0.25%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.